TORONTO • The most recent profit and sales figures at Loblaw Cos. Ltd. may not reflect the grocery chain’s bid to improve volume, but more satisfied customers are helping to drive the business and that should continue, executives told attendees at the grocery giant’s annual general meeting Thursday.

Executive chairman Galen Weston told investors the company is setting itself apart from its peers with the strength of its proprietary brands, such as President’s Choice and Joe Fresh apparel. The clothing line, launched less than seven years ago, he said, and “is now the largest apparel brand in Canada in terms of units and dollars.” One in three customers going into a Loblaw store intend to buy something at Joe Fresh when they are there, according to company research.

In addition to a sweeping IT systems overhaul, the company has made strategic price cuts in a fiercely price-competitive grocery retail landscape. Loblaw is spending $40-million this year on customer-friendly initiatives such as pricing, store execution and customer service to set itself apart from rivals Metro, Sobeys, and Wal-Mart.

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Market research that tracks consumer sentiment showed an increase of 15% at Loblaw in the first quarter compared with the fourth, particularly in the area of fresh food, president Vicente Trius said after the meeting.

“When you make any sort of substantial movement on that score over a short period of time it means that substantial things are happening in the store that are different,” Mr. Trius said of a detailed measure that tallies the retailer’s promoters in degrees compared with its detractors. The company has gained traction against its competitors in market share per square foot, Mr. Trius said, but did not provide specific figures.

“The issue is about enhancing their experience, which is what we are doing,” he said, and that includes better food sourcing in categories such as bread and cheese. “We are actually bringing in better products not only because they look good but because they taste a lot better …and the customer is telling us that.”

Wal-Mart has been pouring grocery square footage into the market in preparation for the Canadian arrival of Target next year. Half of Wal-Mart’s 333 stores currently have grocery stores and the company is embarking on 73 building projects this year, including 43 with a grocery store.